Gov. Katie Hobbs on budget deal and pausing data center tax breaks
Arizona Governor Katie Hobbs announced a bipartisan budget deal, which includes a three-year pause on tax breaks for data centers. This moratorium aims to allow the state to assess sustainable growth, address concerns about water and power usage, and ensure costs are not shifted to consumers, as Arizona is a top market for data centers.
Arizona Governor Katie Hobbs announced a bipartisan and balanced budget, expressing pride in its ability to show cooperation among lawmakers. The budget delivers a $1.4 billion tax break for Arizonans and includes significant investments in public safety, education, and water security.
A key component of the budget is a three-year moratorium on the data center tax credit. Governor Hobbs stated that this pause represents a responsible balance in the ongoing data center conversation. She highlighted that legislators passed the original tax credit about 13 years ago, making Arizona a top market for data centers. The governor emphasized the need for serious discussions about the implications of this growth, particularly regarding sustainable development, responsible water and power usage, and preventing cost burdens on consumers. The moratorium is specifically on the tax credit, not on data center construction itself, and provides an opportunity for the state to consider a longer-term policy during the three-year period.